Fortune 500

Strictly speaking, the Fortune 500 is a list compiled by Fortune magazine raking the top 500 public corporations of the US as measured by their gross revenue. The names that grace the list however command such power and wealth that the Fortune 500 has come to define American business, as well as being defined by it.

Similar lists exist including the Forbes Top 500 Private Companies, Fortune Global 500, Financial Times 500, and Business Week's Global 1000. Each list takes into account different ranking criteria, but none are as prestigious as the original.

In today's business world the corporations that make up the Fortune 500 wield enormous power and influence government policy on a regular basis, as is evidenced by the appointment of Henry M Paulson, CEO of Goldman Sachs, as Treasury Secretary for the United States.

With 2005 profits of US$610 billion, the corporations comprising the Fortune 500 could buy the entire annual economic output of the nations of Brazil, India or South Korea.

Even more impressive, with revenues of US$ 9.1 trillion, if the Fortune 500 were seen as a nation they would have the second largest economy in the world, bigger than the economies of the United Kingdom, Germany, France and Japan combined. If the Fortune 500 constituted a nation they could absorb the US budget deficit for 2006/2007 in its entirety.

History and Influence of Fortune 500

Since 1955 Fortune magazine has produced an annual list of the 500 US corporations with the highest gross revenue. The rankings are based on the revenue figures for each company's previous fiscal year (the end date for which may differ from company to company). The Fortune 100 is the top 100 corporations from the 500 list and the Fortune 1000 is the extended version. Both use the same ranking criteria.

Aside from simply detailing the biggest revenue generating corporations, the Fortune 500 list allows us to see a snapshot of America's commercial progress, where the money has gone and how it's moved to new industries over time.

The growth of opportunities brought in by the building of interstate highways changed the way Americans do business, transport goods, how they travel, shop and where they live. The companies that rose to the opportunities presented by the more than 42,000 miles of highway that were laid from Lose Angeles to New Jersey by the mid 1970's soon found a place on the list.

Chain retailers such as McDonald's and hotel chains like Holiday Inn made the most of the way the interstate was changing American life and profited hugely from it.

The new roads also had a profound impact on corporations in the South of the US with the likes of Coca-Cola, Wal-Mart, Home Depot and Fedex now able to grow and succeed in a way that would not have been possible before. And it helped to shape General Motors, one of the biggest names on the list.

The emergence of credit cards as the preferred method of purchasing has also been influential in the creation of the list, with corporations moving up and down, appearing or disappearing according to how innovative they are about taking payments. Reward cards, smart cards, payroll cards and even embedded credit chips are just a few of the ways corporations are attempting to entice Americans to spend money in the future. The easier it is to spend money, the more consumers spend. Simple.

The Fortune 500 list is also a showcase of adaptability. As consumer's wants change corporations must adapt to meet that demand or risk loosing their place to another who will. Pepsi is one such example of a corporation seeking to meet changing consumer demands. As one of the US's largest manufacturers of snacks, the corporation is now having to come to terms with the consumer's desire for healthy alternatives and look at ways to profitably rise to the challenge.

Fortune 500 Facts and Stats

In 2005 the combined profits of the corporations on the Fortune 500 list were US$610 billion.

490 of the Fortune 500 CEOs are men, only 10 are women. Among the top 100 there are no female CEOs.

Katharine Graham of the Washington Post was the first female executive to run a Fortune 500 company when it joined the list in 1972.

5 million workers are employed by the 10 largest Fortune 500 employers which includes McDonald's, Sears, Home Depot Wal-Mart, and Target.

In 2005, for the first time in the history of the list, Texas displaced New York as the state with the largest number of Fortune 500 companies headquartered there.

The Bank of New York, founded in 1784, is the oldest company on the Fortune 500 list.

DuPont has been on every list since the first one was published in 1955.

There is a Fortune 500 boardgame, released by Pressman Toy in 1980 which companies paid US$30,000 each to be included in.